A U.S. Bankruptcy Court judge is expected to rule today on whether Ann Arbor-based Borders Group Inc. will receive additional time to determine the future of its wide network of store leases.

A so-called "omnibus" hearing is scheduled for 10 a.m. in New York for a ruling on several items, including Borders' lease extension request and final authorization to employ legal counsel and other consultants.

Borders has asked the court for an extension that would give the company more time to figure out whether to renegotiate, sublease or exit leases at its remaining stores.

The company had about 500 superstores and 140 small-format locations when it filed for Chapter 11 bankruptcy protection Feb. 16.

The firm is liquidating 200 of its superstores, including the store in Arborland Center on Washtenaw Avenue. The company is also expected to decide this week whether to close an additional 75 superstores.

On Friday, the company indicated that the additional closures may number 20 to 25 based on current negotiations, although that figure could change.

The extension request would allow Borders to take until Jan. 12, 2012, to make decisions on its remaining leases, a list that includes the flagship store on East Liberty Street in downtown Ann Arbor and the Lohr Road store in Pittsfield Township.

Approval of the extension request within 60 days of the bankruptcy filing is a key requirement of the company's $505 million line of bankruptcy financing with GE Capital.

Meanwhile, a committee of unsecured creditors — namely, the top publishers that supply books to Borders — have questioned the structure of Borders' bankruptcy financing. The company's top seven unsecured creditors, including Simon & Schuster and Random House, are owed more than $193 million.

The unsecured creditors committee, in a court filing, said Borders' debtor-in-possession financing from GE Capital contains "unreasonable, overreaching and otherwise inappropriate" provisions.

The unsecured creditors accused GE Capital of forcing Borders to agree to provisions, including fees and reserve requirements, that would unfairly benefit GE Capital.

But attorneys for Borders countered in a court filing that the financing was "fair, reasonable and, most importantly, the best terms that are currently available to the debtors in the marketplace."

The court provided interim approval for the DIP financing in February. If the court reverses course and requires Borders to renegotiate terms of the DIP financing, Borders could be forced to find an alternative source of lending or to liquidate.

Meanwhile, Borders President Mike Edwards told the Wall Street Journal on Sunday that the company hopes to exit bankruptcy by August or September.

Meeting that goal will require a relatively smooth trip through the bankruptcy process. In April, the company is expected to deliver its proposal on how the company can achieve a sustainable business model. The company will have to convince the court and its secured creditors to approve the plan.

Alternatively, the company's creditors may decide to propose their own plan for the company's reorganization, sale or liquidation.

Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.